The Long Shadow of Adolescent Friendships: How Early Peer Relationships Shape Entrepreneurial Careers

• In Event: Economic Sociology Section Roundtables
  In Refereed Roundtable (60 minute): Roundtable 7: Networks, Embeddedness, and Markets

Abstract

Entrepreneurial careers unfold within social and developmental contexts, yet research has rarely examined how early-life relationships shape entrepreneurial outcomes across the life course. This paper examines whether entrepreneurship diffuses through enduring adolescent friendships. Drawing on two longitudinal datasets, we link individuals to the entrepreneurial activities of friends named during adolescence. We use the National Longitudinal Study of Adolescent to Adult Health (Add Health) to track respondents from grades 7–12 (1994–1995) into midlife (2016–2018), and the Wisconsin Longitudinal Study (WLS) to follow a cohort from age 18 (1957) to age 65 (2004). Across both panels, having an adolescent friend who becomes an entrepreneur significantly increases the likelihood of entrepreneurial entry decades later, controlling for socioeconomic origins, ability, personality, and adult context. The results reveal a hierarchical pattern: friends who pursue incorporated self-employment increase the likelihood of entrepreneurial entry—whether incorporated or unincorporated—and predict higher midlife earnings. In contrast, friends with unincorporated ventures exert limited or negative influence. Peer effects are strongest within small, concentrated adolescent networks. The findings demonstrate that entrepreneurship diffuses through enduring early-life relationships and that the form and quality of peers' entrepreneurial behavior shape both who becomes an entrepreneur and the economic outcomes they achieve.

Authors

• Seok Woo Kwon, University of Calgary

• Kamil Sicinski